Australia vows to cut greenhouse gas emissions

Madeleine Coorey Yahoo News 15 Dec 08;

SYDNEY (AFP) – Australia Monday pledged to cut greenhouse gas emissions by at least five percent from 2000 levels by 2020 to help fight climate change, in a plan dismissed by critics as a "global embarrassment."

Prime Minister Kevin Rudd said Australia could not afford to sit on the sidelines as the world risked environmental disaster caused by rising atmospheric pollution blamed for global warming.

He said the government's pollution reduction plan, which will include a carbon trading scheme due to start in 2010, was "one of the largest and most important structural reforms to our economy in a generation."

"By the end of 2020, we will reduce Australia's carbon pollution by between five percent and 15 percent below 2000 levels," he told the National Press Club in Canberra.

The targets are well below the cuts some environmentalists have warned are necessary to prevent catastrophic climate change, and the Australian Greens immediately labelled the five percent minimum a "global embarrassment."

A small group of protesters occupied the prime minister's Brisbane office, saying the proposed cuts would "only lead to climate chaos and the loss of national icons such as the Great Barrier Reef and the Kakadu wetlands."

Rudd, who was heckled by protesters as he delivered his address, said the government would reduce emissions by 15 percent from 2000 levels if a global pact on climate change was reached.

This would occur "if there is a global agreement where all major economies commit to substantially restrain emissions and advanced economies take on comparable reductions to that of Australia," he said.

Climate change campaigners are hoping to see a historic pact reached in Copenhagen next December to set down unprecedented measures for curbing emissions of heat-trapping carbon gases.

Rudd said the cuts announced Monday were substantial given that Australia's carbon pollution was projected to rise by 20 percent between 2000 and 2020 if no action was taken.

But they fail to go as far as those recommended by the government's independent advisor Professor Ross Garnaut, who has suggested a cut of 25 percent from 2000 levels if a global agreement is reached.

"We are not going to make promises that cannot be delivered," Rudd said.

"We are starting the scheme with appropriate and responsible targets, targets that are broadly consistent with other developed countries."

By comparison, European Union countries are eyeing cuts in carbon emissions of 20 percent by 2020 over 1990 levels.

Rudd said the government would be criticised for not setting higher targets but he believed they would deliver necessary cuts while supporting the economy.

And he said the proposed carbon trading scheme, which will grant permits to industries to cover the amount of greenhouse gases they are allowed to produce each year, would encourage companies to reduce their carbon footprint.

Rudd's announcement came just over a year after the centre-left Labor leader came to power, promising to bring major coal producer Australia in from the cold on climate change.

He ratified the Kyoto Protocol, the landmark United Nations treaty on greenhouse gas emissions, as his first official act after being sworn in as prime minister in late 2007.

He also committed Australia to a 60 percent cut in emissions by 2050 from 2000 levels.

But his statement Monday has failed to impress environmentalists, with a coalition of more than 60 green groups, including Greenpeace and WWF Australia, condemning his plan.

"If adopted globally, this target would guarantee the loss of the Great Barrier Reef and the Kakadu wetlands, and would steer the earth on a path towards catastrophic climate change," they said.

Australian Greens spokeswoman Christine Milne said the government's policy was a "complete failure."

"Five percent is a global embarrassment, 15 percent is way below even the minimum the rest of the world wants to see," she told ABC radio.

Australia to cut pollution 5 to 15 percent by 2020
Rod Mcguirk, Associated Press Yahoo News 15 Dec 08;

CANBERRA, Australia – Australia said Monday it plans to cut its greenhouse gas emissions by as little as 5 percent by 2020 — a reduction that critics say undermines international efforts to reach an effective global pact next year to avert dangerous climate change.

Prime Minister Kevin Rudd said the interim plan would not affect his commitment to slash the carbon emissions that are blamed for global warming by 60 percent from 2000 levels by 2050.

But Rudd was rebuked by an environmental activist while announcing his 2020 targets at the National Press Club in the capital Canberra on Monday.

"No, that's not good enough," a woman in the audience yelled before she was restrained by officials.

Protesters calling for deeper cuts staged angry demonstrations outside Rudd's office in the east coast city of Brisbane and Climate Change Minister Penny Wong's office in the southern city of Adelaide.

Environmental groups have been lobbying for months for a 2020 reduction target to be set at a minimum of 25 percent, as recommended for developed countries by the United Nation's expert Intergovernmental Panel on Climate Change. Rudd's plan calls for an interim reduction range of only 5 percent to 15 percent.

"The weak targets announced today will damage Australia's international reputation and hold back progress toward an effective international agreement," Australian Conservation Foundation executive director Don Henry said in a statement.

Frank Jotzo, an Australian National University economist who specializes in climate change policy, agreed that Australia had undermined the chances for an ambitious reduction target of more than 25 percent at next year's United Nations climate conference.

"It's disappointing because it makes it very difficult, if not impossible, for Australia to come to the party of an ambitious international agreement," Jotzo said.

Australia's largest business group, the Australian Chamber of Commerce, said it remained apprehensive about being burdened with pollution reduction targets during the current economic slowdown.

But Rudd said the global economy could not excuse failing to act on global warming.

"Australia is today the biggest carbon polluter in the developed world on a per capita basis," Rudd said. "Yet we are the developed country with the most to lose from climate change."

The softest target of 5 percent would apply if the United Nations fails to reach a binding agreement at Copenhagen next year committing developing and developed countries to making deep cuts in global emissions.

On a per capita basis, the Australian target is comparable to the European Union's commitment last week to reduce their greenhouse emissions by at least 20 percent below 1990 levels by 2020, the government's climate change policy document said.

Australia also plans to introduce a carbon market on July 1, 2010, where polluters will have to bid against each other for government permits to emit carbon.

Australia Vows 5-15 Percent CO2 Cut, Unveils Trade Scheme
James Grubel, Reuters 16 Dec 08;

CANBERRA - Australia pledged to cut its greenhouse emissions by 5 to 15 percent by 2020 as it unveiled on Monday the world's broadest carbon trading scheme, rebuffing business calls for a delay due to the global slowdown.

While Australia is now second only to the European Union in its drive to cut emissions by establishing a cap-and-trade system that puts a price on carbon output, critics said the target was too weak and blasted the trading plan that will give free credits to some of the economy's most carbon-intensive industries.

Prime Minister Kevin Rudd said the carbon scheme was vital for Australia, which has the fourth-highest per-capita greenhouse gas emissions in the world, and five times more per person than China, due to its reliance on coal for electricity.

"Without action on climate change, Australia faces a future of parched farms, bleached reefs and empty reservoirs," Rudd told the National Press Club.

But some carbon market participants said the system, details of which Canberra unveiled on Monday ahead of approval by parliament expected next year, may fall far short of what's required in the global fight against climate change.

And the government said Australia would only target the full 15 percent cutback if a global deal emerges from U.N. talks in Copenhagen in late 2009, angering environmentalists who had hoped Rudd would follow through on his green electoral mandate by taking a leading role in cutting global emissions.

"It's a total and utter failure. It's madness. Climate change is happening much faster than people thought. Five percent, which is what we are looking at, is an outrage," Greenpeace climate campaigner John Hepburn said.

Friends of the Earth called the plan a "polluters' paradise."

Scientists and green groups wanted cuts of at least 25 percent but the carbon scheme comes at a politically sensitive time for the government, with the mid-2010 start date set only months before it is due to hold elections to seek a second term.

Australia's target is far shy of the 20 percent reduction that Europe has promised and the U.N.'s Intergovernmental Panel on Climate Change recommendation of up to 40 percent by then, and underscores the challenge world governments face in finding a successor to the Kyoto Protocol in the next 12 months.

Rudd defended the targets by saying they were more aggressive on a per-capita basis than those in the European Union.

The government also said the scheme would only trim about 0.1 percent off annual growth in gross national product from 2010 to 2050, with a one-off increase in inflation of around 1.1 percent.

"You could say that the decision came down to a choice between the environment and the economy and at this stage it looks like the economy has won," said Gary Cox, head of environmental derivatives at global brokers Newedge.

MARKET PRICE

The details of the plan released on Monday showed some changes from the draft proposal that came out in July, dropping a much-criticized suggestion to fix initial carbon prices and offering exemptions for the liquefied natural gas (LNG) industry.

Under the new proposal, permits to produce carbon will be auctioned by the government in the first half of 2010, raising an estimated A$11.5 billion in 2010/11 that will help compensate businesses and consumers for higher power and fuel costs.

The system will cover 75 percent of Australia's carbon emissions and involve 1,000 of the nation's biggest firms, the government said, and participating firms will need to surrender a permit for every tonne of carbon emitted.

But there will be exemptions of up to 90 percent for major polluters who could be penalized by the added carbon cost when facing untaxed competitors on the international market, like iron ore and aluminum producers including BHP Billiton, Alcoa and Rio Tinto.

And while LNG producers Chevron and Woodside Petroleum will only get a smaller 60 percent exemption, the industry was pleased that it had been included at all.

Natural gas is a much cleaner-burning hydrocarbon for power plants, but producing it releases large volumes of CO2.

Overall, industry experts said the plan looked weak.

"It seems a bit like the old game of one foot on the brake and one foot on the accelerator, having a bet each way and I'm not sure the numbers add up," said Brett Janissen, executive manager of the consultancy Asia-Pacific Emissions Trading Forum.

"BUY THEIR WAY OUT"

The carbon trade plan allows for prices to be set by the market, first under auctions to be held in the first half of 2010. It estimated an initial price of about A$25 (US$16.70) a tonne, below the European emission allowances, which are trading around 15 euros (A$30) a tonne.

But the government said it would also impose an interim price cap of A$40 a tonne for four years, a move that analysts said could limit the market's development initially.

By allowing polluters to import unlimited carbon permits from green projects abroad, but barring potential exports from Australia, companies will have their pick of the cheapest price.

"The proposed scheme is disappointing in terms of the levels of reductions required as set down by the (U.N.'s) IPCC," said Martijn Wilder, partner at Baker & McKenzie in Sydney.

"By adopting a A$40 price cap, it will provide companies with certainty as to their compliance cost but it also enables companies to buy their way out of compliance, in circumstances where the carbon price breaks the $40 ceiling," he added.

Australian farmers, who have suffered more than seven years of severe drought, will be spared from taking part in carbon trading for at least five years, as expected. Agriculture accounts for about 16 percent of Australian emissions.

But transport and fuel will be included in the scheme.

The government will introduce carbon-trading laws into parliament in 2009, where it needs the support of the Greens and two independent senators, or the conservative opposition, which want the scheme delayed due to the global economic downturn.

(US$1=A$1.49)

(Additional reporting by David Fogarty; Editing by Jonathan Leff)